Notices are an important part of every construction project. They have legal ramifications and risk-related consequences if not handled correctly. A “notice” alerts your customer to changes, conflicts, non-payment, and other issues that should be known and likely addressed. A notice can also set the stage for protecting your rights. For example, many states require contractors to file a “notice to owner” within a set number of days after work first starts on a project. This places owners on notice that work is being done on their property and establishes your rights to file a lien, if necessary.
Understanding notice requirements
Your construction contract should specify those events that will require some form of notice and the specific time frames that must be met. Read your contract carefully, have your lawyer review it, then meet with your customer to clarify and discuss these notice requirements.
To avoid any ambiguity as to how notice is to be provided, it is best that the parties spell out how, where, and to whom notice under the contract must be provided—the more specific the better. To accomplish this, a provision such as the following where the name, address, and manner of service are designated should suffice:
All notices provided for in this subcontract shall be in writing and deemed given if delivered via both first-class postal mail and email to (attention, name, address, email address). Either party may, from time to time, by notice to the other as herein provided, designate a different address and/or representative to which notice to it should be sent. All notices shall be deemed received the earlier of actual receipt or three business days from delivery.
Always put your notices in writing and in the format designated by the contract. A verbal conversation leaves a lot to individual interpretation and won’t likely be relied on in a court of law.
Good practice also dictates that notices should be sent to two parties (the designated recipient and his or her lawyer) or to one person, but via two methods. For example, you can send the notice using email and first-class return receipt mail.
Contractors often come to my law firm concerned that they have missed a notice deadline. While there are some notice exceptions to potentially leverage in these situations, your best protection is to always send proper written notices as part of your general procedures. Make sure your team knows how to manage contract-defined notices correctly. Following proper notice requirements will safeguard your ability to enforce your rights, collect monies due, and address other situations outside of your control. It’s simply good business practice.